Why Rimini Street is reinventing TPM for the world of SaaS

At the Gartner Symposium in Barcelona earlier this month, the signage on Rimini Street's booth proclaimed a $3 billion milestone. The figure represents the total savings the vendor calculates its customers have made to date by switching to its third-party software maintenance (TPM) services. But its current sales pitch no longer focuses solely on cutting costs. In an increasingly hybrid landscape where it also offers support for SaaS solutions, Rimini Street is building a new message around business outcomes. Dean Alms, GVP Global Product Strategy, explains:

When we save you that much money, that creates room in your roadmap. We have story after story of clients that have taken that capability and introduced innovation and gained a leg up on the competition.

In its quarterly earnings call a few days later, CEO Seth Ravin cited the example of new Brazilian customer Grupo Positivo, whose education technology, printing and publishing business plans to reinvest its savings on maintenance costs into IT enhancements such as artificial intelligence and facial recognition systems. That's typical of many customers, he says, who are keen to free up funds and resources to invest in initiatives such as AI, machine learning and the Internet of Things (IoT).

This reflects the changing role of the CIO in many enterprises as the impact of digital transformation gathers pace, says Alms:

What we're seeing out there is a big shift in the CIO priority. The business has started asking the IT organization to help them be much more agile and help them create growth. As technology becomes a competitive weapon for the company, they turn to the CIO and say, how do we win?

We're helping companies increase the capacity of their roadmap so they can go after these growth opportunities.

Reinventing TPM for SaaS

With the IT landscape at many companies evolving to encompass SaaS and cloud solutions, Rimini Street is also expanding its own offering to stay relevant in this new hybrid environment. Earlier this year the vendor launched support services for Salesforce applications, and may be ready to add further SaaS partnerships next year. It sees customers moving away from the old scenario of relying on a single ERP suite vendor for their core computing needs, towards more of a best-of-breed selection. Rimini Street can then act as a single point of contact for supporting that portfolio of applications, Alms explains:

The way of the world right now is much more best-of-breed. It's much more likely a company is going to have a combination. It's not going to be a single-vendor approach. It's going to be an orchestrated ecosystem ...

Our role is more as a unified set of support services. As we know, things are going to break. You can't have one application vendor pointing at another. We make sure your applications stay integrated and supported over time.

Moving into the SaaS environment has meant learning some new tricks, however. On the earnings call, Ravin described the first year of the Salesforce offering as "a big learning experience for us across different customers and geographies." The service is still at an early adopter stage and will roll out with general availability (GA) next year, he says.

Support for frequent updates

One big difference compared to Rimini Street's traditional offering is the need to support frequent functional updates in the SaaS environment. With on-premise applications, a big part of the proposition when moving to Rimini Street is to stay on an existing release rather than face the disruption of an upgrade. In contrast, SaaS applications  typically go through several releases every year.

Enterprises that are used to infrequent 'waterfall' updates can find it difficult to switch to the more agile cadence of continuous delivery. Supporting them through those changes becomes an integral part of the service, says Alms.

One of the biggest challenges organizations have is absorbing that change. For us it's more than a technology, it's just an understanding of the governance and the dynamics of accommodating that level of change ...

That mentality when a company has been doing waterfall for so many years is a cultural shift. Some of that takes place during implementation but the bulk of it will take place during post-implementation. This is the investment we're making today to help our customers take advantage of what's happening from an architecture and development perspective.

DevOps approach to unlock value

Alms describes its approach as similar to the DevOps discipline found in agile software engineering teams that merge development and operations capabilities. Except that in this case it's merging feature adoption with support.

Our portfolio of services is migrating to become much more of a DevOps organization that needs to absorb change on a quarterly basis. Most companies can't absorb and understand that much technology that often, so it goes by the wayside where it could be delivering great value.

This is an opportunity for Rimini Street to help unlock value rather than simply reducing costs, he adds:

If we can help you address those opportunity costs by adopting new features or driving more adoption and utilization, that can be as valuable as reducing your operational budget by 10%.

Not an SI model

The opportunity to provide these services has opened up because systems integrators, even those that specialize in SaaS, are still focusing on implementation rather than ongoing support. Alms believes Rimini Street understands the business model for support services much better than the SIs:

There's a big business model shift between doing implementation versus post-implementation, where we play, which we can provide in a much more remote model.

Ongoing support is a different economic model. It's very difficult for one company to transition to do both of them well. SIs have more than enough work to do by just focusing on implementation. The ongoing support gets done but it doesn't get done as well as it could be.

Another factor is that Rimini Street signs long-term contracts rather than simply delivering a project, he adds:

We are there for the duration. We're not project-based. You're usually hiring us for three, five years. As a result of that we're part of that cultural change. The fact that we're there gives us a big advantage in helping adapt to this new agile model. We can encourage it month after month, quarter after quarter.

My take

For a long time I've felt that SIs needed to evolve their business model in the SaaS world to become more of a long-term partner to enterprises as they continuously evolve their application landscape. But I think Alms is right. SIs are happy to deliver implementation projects — and there's plenty of opportunity for them to do that as part of a long-term partnership without ever running out of work. But that's different from the kind of ongoing, operational support relationship that Rimini Street is proposing. So it has an opportunity to fill that gap.

But like any newcomer to the SaaS scene that arrives from the on-premise world, Rimini Street — and many of its customers — has a lot of learning ahead. I get the impression the company is taking that mission seriously. Alms tells me that part of that is to move away from a model that simply focuses on processing support tickets towards asking what is the business outcome customers are trying to achieve. An example of this is adding support to help people absorb new functionality as well as simply fixing problems. I'd add that this is in tune with the outcomes focus of the SaaS model — what we call the XaaS Effect.

I think the approach also dovetails with Salesforce's increasing emphasis on administrators rather than SIs and developers to drive forward enterprise adoption. Rimini Street's services can help plug the gaps that administrators and in-house developers can't take care of unaided, without having to turn to more costly IT resources.

In principle, then, it all makes a lot of sense. What we now need to see is how this pans out in practice. Rimini Street seems confident that it will be able to roll out a robust offering to GA in the new year, and Alms hinted that it may add other SaaS partnerships to the portfolio during 2019. First it needs to prove its mettle, and the evidence of that will come when the first customer testimony starts to emerge from its early adopters. We'll watch out for that with interest.